Pound Sterling May Continue Rising

Early in a new week, the British pound is looking neutral against the USD. The asset is growing slowly but may easily speed up in the future.

Earlier, the United Kingdom started the third phase of removal of social restrictions in the country – now the population can go to restaurants and pubs. This should have a positive influence on the retail sales and business activity parameters.

As a result, the national currency may be supported from within, because the previous ascending movement happened due to the weak USD.

This week, market players should pay attention to the Net Lending to Individuals for April, a strong number on which may also confirm that the British economy is reviving.

As we can see in the H4 chart, after completing the ascending wave at 1.4232 along with the descending structure towards 1.4111, GBP/USD has finished the correction to reach 1.4218. Possibly, today the pair may start another decline to return to 1.4111 and break it. After that, the instrument may continue trading downwards with the target at 1.4000. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving above 0. A breakout of this level may boost the price chart decline.

GBP/USD

In the H1 chart, after completing the descending structure at 1.4137, the asset has finished the correction towards 1.4197. Later, the pair is expected to fall and reach 1.4111, thus forming the third descending wave. From the technical point of view, this scenario is confirmed by the Stochastic Oscillator: after breaking 50 to the downside, its signal line is expected to continue moving towards 20, thus indicating a further downtrend on the price chart.

GBP/USD

Disclaimer: Any forecasts contained herein are based on the author's particular opinion. This analysis may not be treated as trading advice.